The competition is rarely doing nothing. It’s best to assume in any sales situation that the competition is doing at least as good as you are, and maybe better. Selling is about winning against competitors—people like you, from companies like yours, with products or services that are, in the customer’s eyes, in the running for the deal that’s currently going down.
Competition is an essential part of sales. Selling well means doing a better job of convincing the customer that you have something better to offer than someone else. On first glance the alternatives might look indistinguishable—any of them will satisfy the customer’s requirements, but the best salespeople will have an uncanny knack at singling out something that makes what they have different, different enough that the customer sees it as representing better value–standing out from the crowd.
But there is another quite different alternative in the sales opportunity, one representing a tougher competitive challenge to the salesperson—the customer may elect not to buy anything at all. It’s important to understand what I really mean here. The opportunity has been identified, the customer has expressed a legitimate need and the sales cycle is underway, often near completion. The customer decides, “after a lot of work, research, trial, and discussion, we’ve decided that we’re not going to do that—we’ll revert to status quo.”This is not about changes in circumstances such as budget or even actual requirements, it’s more a statement of, “we’ve been through the purchasing process and have decided not to buy anything.” Experienced salespeople know that this can happen a lot. Salespeople should be aware of the warning signs and factor them into the forecasting process.
Cancellations of potential purchases usually result from flawed decision making scenarios. The customer could be in over their heads. They may not realize it, or are not being honest with themselves. The more complicated the requirements, the more likely it is for these issues to show themselves. Purchase decision-making for companies shares many of the same dynamics as domestic buying for cars or houses. Sometimes exact needs are not fleshed out until the actual buying process is underway. Often it’s the salesperson who provides the information that can ultimately scupper the deal and create the reaction, “if we had only have known that, we would have taken a completely different approach.”
Customers can be pushing for solutions that are totally outside of their comfort zone. The problem could be financing or making commitments with long term resources that are not really there. Considerations of unreal expectations or viability don’t always materialize quickly in the sales cycle. The salesperson can be confronted with the news that “it’s over” at the very time he or she is expecting an order to come in.
Salespeople should always consider the possibility of a dead-end deal and factor it into their projected business. ASPEC asks for two estimations in structuring a probability of a sale—“will we win?” and “will it happen?” The cancelled opportunity affects “will it happen?” Look for the signs: multiple decision makers, complex buying processes, inter-department politics, changes in leadership—anything that kills the buying process without a purchase being made. Factor your assessment into “will it happen?”
It makes a difference—chances that we will win over the competition, 80%, chances deal may not go through, 50%—combined probability, 40%. In any sales opportunity, make sure to consider the competitive option that will always be there—the customer may end the hunt, and do nothing.